NZ Oil & Gas has $162m to acquire oil and gas reserves

BUSINESSDESK: New Zealand Oil & Gas, the nation's largest listed oil explorer, says it has about $162 million in cash available to acquire more oil and gas reserves.

"We have set an exploration target of three to five wells each year with an expected cost in the order of $US35 million," chief executive Andrew Knight told shareholders at their annual meeting in Wellington. "This is an ambition for 2017 rather than a firm boundary and some years we will be able to invest more, some years less."

He singled out the Kakapo prospect off the southeast Taranaki coast which has the potential to be "several times the size of the Tui field" and is 90% owned by NZOG. The company is seeking a semi-submersible rig to drill the prospect and expects to farm out more of it.

The companies two main existing fields are Tui, which produced 2.2 million barrels of oil last year, with NZOG's share 276,000 barrels, and Kupe, which gave NZOG 2.8 petajoules of gas sales, 12,500 tonnes of LPG and 269,000 barrels of light oil.

Kupe and Tui generated $74 million and $42 million of revenue, respectively.

This week, the company announced it had farmed out its Kaheru prospect, east of Kupe, to Beach Energy. The prospect has recoverable reserves of 45 million barrels of oil.

The company will find out in December how successful it has been in bidding for blocks in the government's 2012 blocks offer.

Mr Knight says the company must increasingly look to overseas reserves because having to rely on rigs coming to New Zealand every few years for local drilling puts it in a "make-or-break situation every three years" and this is "clearly not acceptable" in terms of a balanced investment and risk profile.

The shares rose 0.6% to 85.5 cents and have rallied 23% this year.

2 · Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

2 Comments & Questions

Commenter icon key: Subscriber Verified

This company is making tremendous progress, reflected in the improved price. $1 here we come!

  • 0
  • 0

good to see radford retire from chair with dignity. Nothing worse than directors holding on for dear life when they should be down the road.

  • 0
  • 0

NZ Market Snapshot


Sym Price Change
USD 0.6530 0.0000 0.00%
AUD 0.9072 0.0000 0.00%
EUR 0.6160 0.0000 0.00%
GBP 0.4339 0.0000 0.00%
HKD 5.0628 0.0000 0.00%
JPY 80.1490 0.0000 0.00%


Commodity Price Change Time
Gold Index 1056.2 -13.650 2015-11-27T00:
Oil Brent 45.2 -0.320 2015-11-27T00:
Oil Nymex 41.8 -1.230 2015-11-27T00:
Silver Index 14.0 -0.150 2015-11-27T00:


Symbol Open High Last %
NZX 50 6087.9 6103.4 6087.9 0.22%
NASDAQ 5121.9 5134.4 5116.1 0.22%
DAX 11277.9 11354.0 11320.8 -0.24%
DJI 17806.0 17830.4 17813.4 -0.08%
FTSE 6393.1 6393.1 6393.1 -0.28%
HKSE 22555.4 22555.4 22488.9 -1.87%
NI225 19994.0 19994.0 19944.4 -0.30%